Nearshoring to Mexico Fuels Cargo-Carrying Opportunities

Mexico’s emergence as a hotspot for nearshoring is creating new cargo-carrying opportunities for shipping and logistics, industry professionals told Breakbulk.

The number of firms from outside the Americas choosing to relocate all or part of their operations to the region to reduce supply chain risks and save on production and transport costs has soared over the last few years thanks in part to the massive tariffs on Chinese imports imposed by former U.S. President Trump in 2018 and the disruption in global supply chains caused by the pandemic.

Leading manufacturers of automobiles, electronics, pharmaceuticals, heavy machinery, and other products are being lured to Mexico by its free trade agreements with the U.S., a stable business environment, a skilled workforce, and labor costs that are up to 30 percent cheaper than in China.

“Chinese firms are looking at Mexico as a new opportunity to circumvent some of the restrictions, but global companies and European companies are also eyeing Mexico as a way to produce cheaper and get closer to the U.S. market,” said Diego Rodriguez, logistics and industry director at Americas Market Intelligence.

Still, nearshoring has exposed a growing gap between current investment and Mexico’s infrastructure needs, Rodriguez said, pointing to the availability of electricity and water supplies as particular concerns for new manufacturing facilities. In the south of the country, investment in logistics infrastructure such as warehousing facilities, railroads, roads, and industrial facilities is also a priority. As such, the director expects opportunities to open up for breakbulk as new project announcements are made.

“The forecast for demand in terms of power generation in the next decade is growing at a double-digit rate, so there will be great need for industrial equipment,” Rodriguez said. “The country is also building industrial parks, power plants – and this requires a lot of steel, a lot of building materials to meet the demand.”

As more companies bring their production to Mexico or expand their existing businesses, transport opportunities for shipping and logistics will also grow. New clusters are starting to form in different regions of the country – the northern state of Nuevo Leon, for example, has emerged as a hub for electric vehicle production, with companies such as Tesla planning to build new facilities there.

“The states have created incentives to continue bringing those companies into those regions. With nearshoring, we expect an evolution of those clusters and more specialization between those regions in Mexico,” Rodriguez said.

Carlos Carcoma, asset-based sales director at Mexico-headquartered heavy-lift specialist Tradelossa, said nearshoring was a “second, once-in-a-lifetime opportunity” for Mexico following the NAFTA free trade agreement with the U.S., which came into force in 1994.

“Mexico this year has already become the number one trading partner of the U.S., above China. If the right political decisions are made, then nearshoring could bring growth not only to the industrial sector in Mexico, but to the whole nation,” Carcoma told Breakbulk.

Mexican companies such as Tradelossa are adapting to the demands of manufacturers choosing to set up shop in Mexico, particularly in areas such as sustainability and cleaner fuels.

“We always want to be top of our industry by complying with the requirements of foreign companies – they bring investments, they develop big projects – and we want to be there, we need to adapt to their needs,” Carcoma said. “So how can we optimize our processes? How can we adapt technology and innovation into our freight services? In other words, how do we add value to those companies that come here?”


Tradelossa, which this year is celebrating its 50th anniversary, is an exhibitor at Breakbulk Americas.